How much of total US tax revenue comes from the top 1% versus payroll taxes?

1. What advocates and reports are actually claiming — a clear tally of the headline assertions

Multiple recent analyses assert that the top 1% paid about 40.4% of federal income taxes in 2022, and that the top decile or quarter pay an outsized share of income tax burden. These claims come from tax-distribution tables and IRS-based summaries that report shares of the individual income tax liability, not shares of all federal receipts ^{[1] [4] [3]}. Separately, fiscal summaries and government revenue breakdowns report that payroll taxes constitute roughly 32–36% of federal revenue in recent years, figures that refer to the composition of total federal receipts, not the distribution across households ^{[5] [2] [6]}. The difference in denominators—income tax share versus total revenue—explains much of the apparent contradiction in plain-language comparisons.

2. The case for “top 1% pay ~40%”: what that number measures and why it matters

The statistic that the top 1% pay about 40.4% of all federal income taxes measures only the individual income tax base and is typically drawn from IRS data or Foundation analyses of 2022 tax liabilities. It reflects the concentration of income and taxable income at the top: the top 1% earned a substantially larger share of AGI and therefore bear a large fraction of income tax liabilities under current law ^{[1] [4] [3]}. This metric highlights the progressivity of the income tax system: high earners face higher average income tax rates and thus account for a large share of income-tax receipts, but it should not be read as their share of all federal revenue without adjustment.

3. Payroll taxes as a share of government receipts — the other big slice of the pie

Multiple government-accounting summaries and policy analyses place payroll (social insurance) taxes in the range of roughly 32–36% of federal receipts in recent fiscal years, with payroll taxes primarily funding Social Security and Medicare trust funds ^{[5] [2] [6]}. Payroll taxes are collected largely on earned wages, have a different incidence and statutory structure than income taxes (e.g., wage caps on Social Security tax), and are often paid more uniformly across middle- and lower-income households. Because payroll taxes fund dedicated programs and represent a large share of receipts, they are central to any comparison between what the top 1% pay and what payroll taxes generate for the federal government.

4. Why apples-to-apples comparisons are rare — methodological frictions that flip interpretations

Comparing “share of income taxes paid by the top 1%” with “share of total federal revenue from payroll taxes” mixes distinct concepts and denominators. The first is a distributional share of a single tax type (who pays income tax), the second is a composition share of total receipts (what fraction of government funding comes from payroll taxes). Some sources report the top 1% share as a share of total federal taxes (lower numbers like ~16% appear when income taxes are combined with payroll and other taxes), while others report the top 1% share of just income taxes (~40%) ^[7]. Reconciling these requires noting the fiscal year, whether refunds/credits and payroll-to-trust-fund flows are included, and whether analysis uses family-level or tax-filer units.

5. Putting the numbers side-by-side — a reconciled snapshot

Using the available summaries, a coherent snapshot is: top 1% ≈ 40% of federal income tax receipts in 2022, while payroll taxes ≈ 32–36% of total federal receipts in recent fiscal years. If you instead ask “what share of all federal taxes do the top 1% pay?” the figure falls—estimates in linked analyses place that number closer to 16% of total federal taxes depending on the aggregation ^{[1] [7] [2]}. The key takeaway: the 40% headline is true for income tax only; payroll taxes remain a comparably large and distinct revenue source for the federal government.

6. Practical takeaways for policy and public debate — what these figures do and don't prove

These data show both that the income tax system concentrates liability among high earners and that payroll taxes are a major, relatively broad-based revenue source. Policy debates that treat “top 1% pays X%” as a complete picture risk omitting payroll taxes’ role and the different economic incidence of each tax. Claims that the top 1% “fund most of government” are misleading unless they explicitly limit the claim to income tax receipts; conversely, arguments framing payroll taxes as the dominant source should note payroll taxes’ narrower nexus to social insurance programs and their regressive features across incomes ^{[3] [6]}.